Chaos Monkeys by Antonio García Martínez [Book Summary]

The past few decades have seen the dizzying rise of numerous companies in Silicon Valley, California. Presently, these companies are part of the most powerful in the world; it would be difficult to exaggerate the vastness of the part they play in the lives of the majority of westerners. 

However, just like a lot of success stories, it’s not entirely rainbows and sunshine.

A deeper insight into how these companies truly function shows a stormier depiction.

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Chapter 1 – Migration to Silicon Valley is really hard that immigrants at times opt for false marriages.

During the eighteenth-century when Europeans were attempting to meet up with America, a lot of people paid for their passage by succumbing to a lot of years of obligated bondage. While tech nerds looking for work in twenty-first-century America don’t have it pretty that bad, they still experience a very hard deal.

It is not easy for an immigrant to be permitted to work in Silicon Valley, and the process usually causes exploitation.

One answer is to obtain an H-1B visa: which is a nonimmigrant visa for foreign workers. But, just a small number of these visas are available. In 2013, 200,000 foreign workers wishing for work in Silicon Valley applied for an H-1B visa; however, just only 16,000 were granted.

And the fortunate ones that their visa got approved are then completely at the mercy of their boss.

If they’re sacked or the company closes down, their visa won’t be valid anymore, a state of insecurity that usually leads in their feeling forced to take a smaller pay than their American coworkers.

Due to this, companies are huge winners. They get very skilled workers who will work for less, and these workers need to bear five years of this exploitation before they can even apply for a green card, which offers them better privileges and permanent-residence status.

No wonder that immigrants want to dodge this whole thing. And the simplest means to do that is through a fake marriage.

The US immigration system is welcoming to people who are attempting to start a new family. As a matter of fact, close-relative or family-preference visas contribute to two-thirds of the entire successful immigration applicants.

Amazingly, for this approach to work, you don’t even need to marry a citizen of American.

A Greek computer specialist named Stanis Argyris wanted to become part of the author’s start-up team in 2008. Therefore, Argyris got married to a Turkish woman who, with a student visa, was schooling at Stanford University. Now Argyris could get a student-spouse visa, remain in the country and ultimately work at the author’s company.

Chapter 2 – Google makes huge amounts of money from its automated advertising system.

Definitely, life would be much easier if you could print out your own money. However, since printing your own money is an extremely punishable crime, the next best option would be to form a company such as Google.

One of Silicon Valley’s biggest success stories, Google is an extraordinary money-making machine.

Yearly, Google makes about $70 billion in profits, an amount really remarkably large that you might be thinking, “How can a search engine make such huge money?”

For beginners, it provides solutions to a lot of life’s significant questions, for instance,  “What’s the best camera with a price less than $300?” to “Who’s a good divorce lawyer in the state?” However, Google also makes ads for companies correlated to your searches – and gets money each time a person clicks on one.

The sum of money Google gets from a particular click relies on the keyword being used and the number of companies that are bidding on it. A famous one such as “insurance” can be worth as much as $54 for each click.

Maybe even more amazing is that Google barely breaks a sweat handling the entire bidding companies since they have an ingenious way of letting computers do the work for them.

This, definitely, is reasonable. There are numerous different term people look for and determining how to sell individual ad space for each one would be practically impossible.

To fix this issue, Google holds an automated, prompt and lightning-quick auction.

It begins the instance a search is started: Google’s computers immediately check through the whole pre-placed bids that advertising companies have created for this term.

When this occurs, two things are being taken into account: the top bids and the person that has the best opportunity of being clicked on. The ad that best merges these two standards will be put at the top of the search outcomes.

This is the reason why various searches for the same word might bring out different results. If you look for “London Furniture” today, the leading bid might be the handcrafted furniture company Swoon Editions; but, the following week; it might be the luxury furniture providers Unum Design.

Chapter 3 – Financing a start-up is a risky business; therefore, the firms compensate for specials offers.

If you’re a thrill-seeker person searching for a risky adventure, you might attempt whitewater rafting or bungee jumping. Or you could avoid travel and the risk to your body by financing in a start-up.

Probabilities are, you won’t have any issue seeing a chance because start-ups are usually searching for risk-friendly investors.

A start-up starts its hunt for funding with what’s known as a seed round. This is when the company’s entrepreneurs get money from family and friends while anticipating to get big-time investors.

These start-up investors are in a risky state for two causes: The company could either be unsuccessful and they won’t get their money back again, or the company could become extremely successful and they’ll eventually get a microscopic share.

Let’s assume that a friend gives $100,000 in seed money and that this initial loan is changed into an equity investment after the company, which has become successful, chooses to go public. And let’s assume that the start-up is valued at $10 million: because 100,000 divided by 10 million is equal to 0.01, the friend who offered $100,000 would now be the owner of 1% of the company.

Clearly, 1% isn’t a good result; therefore, to assist avert the illusion of such situations from scaring away possible investors, start-ups give special offers.

One enticing bid is to put a cap, or a maximum sum, on the company’s valuation. This avoids an investor’s share from becoming really small.

Let’s go back to the friend who gave $100,000, and let’s say the company accepted to put a $3-million cap on their initial valuation. This would offer the friend 3.3-% ownership when the company starts. Even if the company were to ultimately be valued at $100 million, the friend’s first percentage would increase together with the company.

While this bid can make one risk look less worrying, the reality that the company can still crash is still an inevitable worry.

Chapter 4 – Steve Jobs and Bill Gates had their start by doing some deceitful dealings.

 A lot of parents imagine giving birth to children who’ll grow up to be both successful and really nice. These parents might not wish for their children to go into the start-up industry. In the start-up world, success is most certainly not the outcome of niceness.

As we’ll get to understand, both Bill Gates and Steve Jobs used quite ruthless approaches on the route to riches.

Bill Gates came from a rich Seattle family, dropped out of Harvard University before beginning a small tech company known as Microsoft in 1975.

During that period, some loyal networks at IBM mentioned to Gates that the computer giant was searching for a new operating system.

And Gates knew a guy that is capable of the work: the IT genius Gary Kildall. However, to Gates’ surprise, Kildall declined to accept the conditions of IBM’s contract.

This was when Gates stopped being nice. Understanding Kildall was sitting on a gold mine, he made a Microsoft programmer replicate Kildall’s operating system and change the name to IBM’s Disk Operating System (DOS).

After Gates registered the copyright under his own name, the innovative system, which allowed it to be possible for computer hardware to be replaceable, became the property of Microsoft. Therefore, the popular abbreviation: MS-DOS.

Due to that, both Kildall and IBM did not see a penny of the billions that started pouring Gates’s way.

Also, Steve Jobs was notorious for his unkindness, even when he first began.

Jobs started as an unpopular worker at Atari, the company that did the table-tennis-like video game, Pong. In 1975, Nolan Bushnell, the company’s CEO, proposed a prize of numerous thousand dollars to anybody who could form a single-player version of Pong.

Enthusiastic to win the prize, Steve Jobs asked for the assistance of Steve Wozniak his friends, who could fix just about any kind of technical issue. Jobs pushed hard until Wozniak eventually solves the problem. Jobs got the reward money.

So Jobs mentioned to Wozniak that the reward money was only $700 – not a few thousand – and gave him $350 for his work.

Chapter 5 – Starting start-up needs obsessiveness and the determination to never give up.

Also, billionaire tech giants such as Jobs and Gates also possess a reputation for being quite smart. However, if you desire to succeed in the world of Silicon Valley, there are other abilities that surpass intelligence.

One of these abilities –may be the most significant when starting a start-up – is obsessiveness.

Before the author created AdGrok, which is a start-up that improves GoogleAds, he was at the lowest of his Ph.D. class, even needing to take a number of exams again.

He was jealous of a lot of the computer programmers that surrounded him, people who were more intelligent and more talented than he was.

Although not as bright as some of them, Martinez was obsessive. And this is the ability that gave him success in Silicon Valley.

While he working on the AdGrok project, he was really engrossed that no other thing mattered. Life was basically one tech occasion or company retreat after another; he worked absurd hours each day, and he saw his daughters growing and changing on Skype instead of real life.

Work obscured his life. He gave up family life. He gave up his interests. He suspended books and watching films, and took out every interruption until AdGrok started.

It’s not good means to live; however, Martinez was got paid for his obsessiveness. In 2011, AdGrok was acquired by Twitter for more than $10 million.

Another very essential ability that can assist start a start-up is a refusal to give up.

Some people, just like the author, acquired this ability early on. Martinez ascribes his success to having survived a hard childhood that comprised a sadistic older sister, a bullying father, and usual schoolyard fights.

By surviving through a hard childhood, Martinez developed a never-give-up attitude that he later utilized to the time he worked at the Wall Street trading floor and the ceaseless difficulties he experienced during AdGrok’s launch.

Chapter 6 – Facebook’s determined leadership and obsessively trustworthy workers faced the difficulty of Google Plus.

The type of determination and will-to-win displayed by Martinez is contagious. Also, in the record of start-ups, there is maybe a no better illustration of an obsessively committed team rising to a confrontation than what occurred at Facebook’s headquarters in 2011.

That was the year Google confronted Facebook’s status as the leading social platform with the creation of Google Plus.

It was a severe challenge. Google had lost some of its most skilled workers to the younger start-up, and it was now time to eventually go on the offensive. Already, Google already had a lot of successful products, such as Gmail and YouTube, that helped Google Plus. And when it started, its design, photo- sharing features and ad policies were entirely better than Facebook’s.

However, Facebook wasn’t only going to roll over; their response was fast and displayed that the company had nurtured a trustworthy and committed team of workers.

The only thing they required was the appropriate motivation, and that’s precisely what Mark Zuckerberg, their leader, offered.

As soon as he heard about Google Plus, he instantly put the company on “Lockdown,” telling the entire workers to stay on-site and work 24/7 until the threat was neutralized.

Zuckerberg isn’t really a talented speaker; however, to inspire his workers, he responded to the circumstance and gave an inspiring speech that asked for Facebook’s quality to be upgraded in record time. For the highlight of the speech, Zuckerberg mentioned the Roman senator Cato the Elder quote by stating, “Carthage must be ruined!” Clearly, Google Plus was Carthage to Zuckerberg’s Rome.

His workers reacted. They changed the challenge into an occasion by whipping-up Roman costumes and posters and immediately redesigning Facebook’s functionality and photo-sharing selections to be consistent with Google Plus.

Therefore, eventually, Facebook’s customers saw a slight reason to leave. And Zuckerberg displayed that a company with a trustworthy corporate culture eager for motivation can rise to the hardest difficulties.

Chapter 7 – There are good motives on why Facebook’s security team is kept out of the public eye.

Some of Facebook’s main fights have been extensively reported on. However, behind the scenes, there is a regular series of battles, and a team of workers who are usually in the fight, defending Facebook’s customers.

If you are on Facebook, you most likely use it to keep in contact with friends and play games and remain up-to-date on current incidents. However, you probably don’t know that, while you’re viewing photos and chatting with friends, Facebook’s security team is protecting you from unsettling content.

Online security is one of the major difficulties for internet start-ups, and security teams need to assess every ad and be on the guard for a range of online threats: scammers, sexual predators, pornographers and so on.

Since this is done mostly in the dark, it is a difficult job. It has a tendency to be seen just when something goes wrong or slips through the cracks, where the security is put to blame.

As a matter of fact, frequently people get annoyed about the job they do and summon them for censorship when they mistakenly flag something like a breastfeeding image.

Since users usually do not remember to show appreciation for the precise and helpful flagging of destructive content, and maybe also to make up for their normal anonymity, Facebook’s security team opened a Facebook group known as Scalps@Facebook. With this, the images and profiles of the criminals they have removed are listed together with an account of the crimes they’ve done.

However, apart from this group page, there are good causes for Facebook to keep the team’s work hidden. The main reason is that if people were aware of the sordid information of the several crimes and attempted crimes, it could really well prevent people from making use of Facebook.

A lot of users are already worried about their online privacy and safety, and if they were informed of all sex offenders and scammers that were caught on Facebook, they might be wary of using it. While the security team would be respected, parents would probably ensure that their children stayed away totally.

Eventually, it’s another illustration of the numerous exciting – and disturbing – things that are happening behind the scenes at Silicon Valley.

Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley by Antonio García Martínez Book Review

Silicon Valley can be a cruel and competitive place. Certainly, friends have been known to betray each other to get to the next step on the ladder of success; however, Silicon Valley provides some interesting and motivating stories too. For the people that are ready to sacrifice everything for a trail at becoming the next start-up millionaire, Silicon Valley might be just the appropriate place.

Improve your grit.

If you wish you would like to begin a start-up; however, feel doubtful if you have the essential support, begin by walking across a continent, or sailing across an ocean. If you succeed, you may possibly have gotten the resilience to succeed in the world of start-ups, as well.

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